| ||August 10, 2010|
CanAm Coal Corp. Announces Convertible Debenture Offering
| ||Calgary, AB, August 10, 2010 - CanAm Coal Corp. (TSXV: COE) ("CanAm" or the "Company") is pleased to announce an unsecured convertible redeemable debenture offering (the "Offering") of a minimum of 250 and a maximum of 500 of $5,000 principal amount debentures (the "Debentures") for total gross proceeds of a minimum $1,250,000 and a maximum $2,500,000. The Debentures will have a minimum subscription per subscriber of $10,000. The Debentures will bear interest at the rate of twelve per cent (12%) per annum, payable semi-annually on the last day of August and February, with the first interest payment commencing on February 28, 2011. The Debentures will have a term of 36 months (or 3 years) with a maturity date of August 31, 2013. The Debentures will be convertible at the holder's option into common shares of the Company at any time prior to the maturity date at a conversion price of $0.15 per common share in year one, $0.17 in year two and $0.19 in year three. The Company can redeem the Debentures at any time prior to the maturity date for, at the holder's option, either cash or common shares of the Company issued at the conversion price for that year. The Company can force conversion of the Debentures into common shares if the Company's common shares trade, on a 21 day volume weighted average basis, at or above a 25% premium to the conversion price for that year. The forced conversion of the Debentures is limited to 1/3 of the outstanding Debenture principal amount per year.|
The Company expects the Offering to close on or around August 31, 2010. The net proceeds of the Offering will be used to fund the Company's buy-out of its partner in RAC Mining LLC, to purchase coal mining equipment and provide for general mine working capital.
A finder's fee equal to seven percent (7%) of the gross proceeds of the Offering may be paid on all or any portion of this Offering. Additionally, finder's warrants exercisable into common shares of CanAm may be issued in an amount equal to the quotient of nine percent (9%) of the gross proceeds on all or any portion of this Debenture Offering divided by $0.10. The finder's warrants will be exercisable for a period of one year from the date of the issuance at $0.10 per common share.
Completion of the Offering is subject to receipt of all necessary regulatory approvals including the approval of the TSX Venture Exchange. It is not anticipated that any new insiders will be created, nor that any change of control will occur, as a result of this Offering.
About CanAm Coal Corp.
CanAm is a coal marketing and development company focused on growth through the acquisition, exploration and development of coal resources and resource-related technologies. CanAm's main activities and assets include its 49% owned Alabama coal operations, the exclusive rights to a proprietary Coal to Liquids technology which converts coal into liquid fuels (such as oil, jet fuel) at an economical cost with zero airborne emissions and the Buick Coal Project which holds significant coal resources, 188 million tons of indicated and 103 million tons of inferred coal resources, in Colorado, USA (see the technical report entitled "Limon Lignite Project, Elbert County, Colorado, USA," dated October 26, 2007 and filed on SEDAR on November 2, 2007). Other coal and related opportunities continue to be evaluated on an ongoing basis.
For Further Information:
Corporate Head Office:
Timothy J. Bergen, CEO
Toll Free: 1.877.262.5888
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release may contain certain forward-looking information. All statements included herein, other than statements of historical fact, is forward-looking information and such information involves various risks and uncertainties. There can be no assurance that such information will prove to be accurate, and actual results and future events could differ materially from those anticipated in such information. A description of assumptions used to develop such forward-looking information and a description of risk factors that may cause actual results to differ materially from forward-looking information can be found in the Company's disclosure documents on the SEDAR website at www.sedar.com. The Company does not undertake to update any forward-looking information except in accordance with applicable securities law.
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